Nike Results Beat Estimates; Stock Up 5%

Sports giant Nike (NYSE:NKE) is scheduled to report its earnings for the first quarter of fiscal 2016 on Thursday, September 24th.

Nike delivered earnings of $1.34 per diluted earnings per share, an increase of 23% driven by a broad-based revenue growth, gross margin expansion, selling and administrative leverage and lower effective tax rate and share count.

Revenues for the quarter were up 5% at $8.41 billion compared with $7.98 billion in the prior year.

In a report released today, Jim Duffy from Stifel Nicolaus reiterated a Buy rating on Nike (NYSE: NKE), with a price target of $135. The company presently has an average rating of “Buy” and a consensus price target of $124.50. Using these inputs, we arrive at a net present value of $92.1 billion for all of Nike’s future free cash flows.

Nike Inc. (NYSE: NKE) is leading the charge to capitalize on the world’s newfound love of “athleisure” gear. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate.

The company’s quarterly earnings per share also came in above analysts’ expectations as did its quarterly revenue. Although the company may harbor some minor weaknesses, we feel they are unlikely to have a significant impact on results. Finally, Morgan Stanley set a $130.00 target price on Nike and gave the company a “buy” rating in a research note on Friday. The company has a 50 day moving average price of $112.59 and a 200-day moving average price of $106.23. Post opening the session at $114.15, the shares hit an intraday low of $113.76 and an intraday high of $115.63 and the price vacillated in this range throughout the day.

The Dow Jones Industrial Average (DJIA – 16,314.67) was up by as many as 264 points, before settling on a gain of 113.4 points, or 0.7%. Also, insider Trevor A. Edwards sold 97,345 shares of the company’s stock in a transaction dated Thursday, July 2nd. Brands like Nike, Under Armour and Lululemon are locked in a heated battle to market and sell fashion-forward apparel that can be worn to the office as easily as to the gym.

NIKE, Inc. (NYSE:NKE) is engaged in design, development, marketing and selling of athletic footwear, apparel, equipment, accessories and services. The Business sells its products through NIKE owned internet websites and retail stores. Basketball and Men’s Training include its Brand Jordan product offerings and United States football merchandise offerings and its baseball, respectively.

For the first quarter, Nike brand North America revenue rose 8% to $3.8 billion, while Western Europe revenue fell 4% to $1.6 billion and revenue from Central and Eastern Europe grew 2% to $401 million.